Asian ACN makers cut production in the hope of halting decreased prices

October 24/2011

(ICIS) -- Acrylonitrile (ACN) makers in
Asia have cut production in the hope of halting an unabated decline of product
prices that is now on its sixth month, industry sources said on Monday. Spot ACN
prices have tumbled by more than $1,000/tonne (?720/tonne) from early May to
$1,700-1,750/tonne CFR (cost and freight) northeast (NE) Asia in the week ended
21 October, ICIS data showed.

Regional ACN producers such as Asahi Kasei in Japan, Tongsuh
Petrochemical in South Korea and Formosa Plastics Corp in Taiwan are
currently running their plants at about 80% of capacity, industry sources said.
УWe will continue to run at about 80% of our total production capacities at our
plants in Japan and South Korea until demand recovers,Ф said a company source at
Asahi Kasei.

Asahi Kasei can produce a total of 765,000 tonnes/year of ACN at its
plants in South Korea and Japan. Its fully-owned subsidiary, Tongsuh
Petrochemical has an ACN capacity of 315,000 tonne/year at Ulsan in South Korea,
while its other two plants at Kawasaki and Mizushima in Japan have a combined
capacity of 450,000 tonnes/year.

In China, Jilin Petrochemical has shut down two lines in Jilin that each
have 106,000 tonne/year capacity. One line was shut in early October, with no
firm date when the unit will resume production, a source at the company said.
The other line has been shut since April. Jilin has two other ACN lines, each
with a capacity of 120,000 tonnes/year at the same site, that are running at
normal rates.

In Taiwan, China Petrochemical Development Corp (CPDC) has brought
forward a 40-day turnaround at one of its two ACN lines in Kaohsiung to early
October from its original date in November because of the current weak prices, a
company source said.